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EXHIBIT 10.18
_____________________________________________________
SCC COMMUNICATIONS CORP.
CO-SALE AGREEMENT
________________________________________________________
DATED AS OF NOVEMBER 20, 1997
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TABLE OF CONTENTS
PAGE
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SECTION 1. DEFINITIONS . . . . . . . . . . . . . . . . . . 1
SECTION 2. SALES BY SHAREHOLDER. . . . . . . . . . . . . . 1
2.1 NOTICE OF PURCHASER OFFERS. . . . . . . . 1
2.2 RIGHT TO PARTICIPATE. . . . . . . . . . . 2
2.3 CONSUMMATION OF SALE. . . . . . . . . . . 2
2.4 ONGOING RIGHTS. . . . . . . . . . . . . . 2
2.5 PERMITTED EXEMPTIONS. . . . . . . . . . . 2
SECTION 3. PROHIBITED TRANSFERS . . . . . . . . . . . . . . 3
3.1 TREATMENT OF PROHIBITED TRANSFERS . . . . 3
3.2 PUT OPTION . . . . . . . . . . . . . . . 3
SECTION 4. LEGENDED CERTIFICATE . . . . . . . . . . . . . . 3
4.1 LEGEND . . . . . . . . . . . . . . . . . 3
4.2 LEGEND REMOVAL . . . . . . . . . . . . . 4
SECTION 5. TERMINATION OF CO-SALE RIGHTS . . . . . . . . . 4
SECTION 6. OTHER OBLIGATIONS OF COMPANY . . . . . . . . . . 4
SECTION 7. MISCELLANEOUS . . . . . . . . . . . . . . . . . 4
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CO-SALE AGREEMENT
This is a CO-SALE AGREEMENT dated as of November 20, 1997 ("Agreement")
by and among SCC COMMUNICATIONS CORP. ("SCC"), a Delaware corporation, ▇▇▇▇▇▇
▇. ▇▇▇▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇▇▇▇, THE ▇▇▇▇ PARTNERSHIP III, A LIMITED
PARTNERSHIP, AMERITECH DEVELOPMENT CORPORATION AND BOSTON CAPITAL VENTURES
LIMITED PARTNERSHIP and BANC ONE CAPITAL PARTNERS II, LLC ("BOCP"), a Delaware
limited liability company, provided for in and entered into pursuant to the
SENIOR SUBORDINATED NOTE AND WARRANT PURCHASE AGREEMENT dated the date hereof,
as amended, restated, supplemented or otherwise modified from time to time
("Purchase Agreement") by and between BOCP, as purchaser, and SCC, as seller.
ASI, together with its successors and assigns, is referred to as the
"Company." The individuals named in the first paragraph hereof, together with
their respective successors and assigns, are referred to individually as a
"Shareholder" and collectively as the "Shareholders," and BOCP, together with
its successors and assigns, is referred to as the "Holder." The Company, the
Shareholders and the Holder are referred to collectively as the "Parties" and
individually as a "Party."
THIS AGREEMENT IS ONE OF THE "RELATED DOCUMENTS" REFERRED TO IN THE
PURCHASE AGREEMENT.
In consideration of their mutual promises set forth in this Agreement
and the Purchase Agreement, the Parties hereby agree as follows.
SECTION 1. DEFINITIONS
All capitalized terms not otherwise defined in this Agreement shall have the
definitions set forth in the Glossary of Defined Terms attached to the Purchase
Agreement, which definitions are, to the extent applicable, incorporated in
this Agreement by reference.
SECTION 2. SALES BY SHAREHOLDERS.
2.1 NOTICE OF PURCHASER OFFERS. Should one or more
Shareholders propose to accept one or more Purchase Offers, then each such
Shareholder shall promptly notify the Holder of the terms and conditions of
such Purchase Offer.
2.2 RIGHT TO PARTICIPATE. The Holder shall have the right,
exercisable upon written Notice to such selling Shareholder within fifteen (15)
Business Days after receipt of the notice of the Purchase Offer, to participate
in such selling Shareholder's sale of Common Shares or Convertible Securities
on the same (or, in the case of Convertible Securities, equivalent) terms
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and conditions. To the extent that the Holder exercises such right of
participation, the number of Common Shares or Convertible Securities which such
selling Shareholder may sell pursuant to such Purchase Offer shall be
correspondingly reduced. The right of participation of the Holder shall be
subject to the following terms and conditions:
(a) The Holder may sell all or any part of that number of
Holder's Shares equal to the product obtained by multiplying (i) the aggregate
number of Common Shares (including the Common Share equivalent of any
Convertible Securities) covered by the Purchase Offer by (ii) a fraction (A)
the numerator of which is the number of Holder's Shares at the time owned by
the Holder, and (B) the denominator of which is the sum of (x) the number of
such Common Shares (including the Common Share equivalent of Convertible
Securities) at the time owned by the Selling Shareholder, and (y) the number of
Holder's Shares at that time owned by the Holder. For purposes of making such
computation, the Holder shall be deemed to own the number of Common Shares as
if its Warrant Shares had been converted into Common Shares.
(b) The Holder may participate in the sale by (i) exercising
the Warrant in accordance with its terms, if Warrant Shares are to be sold, and
(ii) delivering to the selling Shareholder for transfer to the purchase offeror
one or more certificates, properly endorsed for transfer, free and clear of all
adverse claims, which represent that number of Holder's Shares which the Holder
elects to sell pursuant to this Section 2.2.
2.3 CONSUMMATION OF SALE. The stock certificate or
certificates which Holder delivers to the Selling Shareholder pursuant to
Section 2.2 shall be transferred by the selling Shareholder to the purchase
offeror in consummation of the sale pursuant to the terms and conditions
specified in the Section 2.1 Notice to the Holder, and such Selling Shareholder
shall promptly thereafter remit to the Holder that portion of the sale proceeds
to which the Holder is entitled by reason of its participation in such sale.
2.4 ONGOING RIGHTS. The exercise or non-exercise of the
rights of the Holder pursuant to Section 2.1 hereof to participate in one or
more sales made by any selling Shareholder shall not adversely affect the
Holder's right to participate in subsequent sales by any selling Shareholder.
2.5 PERMITTED EXEMPTIONS. The participation rights of the
Holder shall not apply to (i) any bona fide gift, transfers to family members
or trusts established for the benefit thereof, or transfers upon death or
disability; provided that a Shareholder shall inform the Holder of such gift
prior to effecting it and the donee shall furnish the Holder with a written
agreement to be bound by, and comply with, all provisions of this Agreement
applicable to such Shareholder; (ii) the sale of up to 200,000 Common Shares,
in the aggregate, by ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇ and ▇▇▇▇▇ ▇▇▇▇▇▇▇▇; and
(iii), the sale or transfer of Common Shares to partners, stockholders or
affiliates of a Shareholder.
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SECTION 3. PROHIBITED TRANSFERS.
3.1 TREATMENT OF PROHIBITED TRANSFERS. In the event a
Shareholder should engage in a Prohibited Transfer, the Holder, in addition to
such other remedies as may be available at law, in equity or hereunder, shall
have the put option provided in Section 3.2.
3.2 PUT OPTION. In the event of a Prohibited Transfer, the
Holder shall have the right to sell to the Shareholder engaging in such
Prohibited Transfer that number of Common Shares or Convertible Securities
owned by the Holder equal to the number of shares the Holder would have been
entitled to transfer to the purchase offeror in the Prohibited Transfer
pursuant to the terms hereof. Such sale shall be made on the following terms
and conditions:
(a) The price per share at which such Common Shares or
Convertible Securities are to be sold to the Shareholder shall be equal or
equivalent to the price per share paid by the purchase offeror to the
Shareholder in the Prohibited Transfer. The Shareholder shall also reimburse
the Holder for any and all reasonable fees and expenses, including legal fees
and expenses, incurred pursuant to the exercise or the attempted exercise of
the Holder's rights under this Section 3.
(b) Within thirty (30) days after the earlier of the date on
which the Holder (i) receives Notice from a Shareholder of a Prohibited
Transfer, or (ii) otherwise becomes aware of a Prohibited Transfer, the Holder
shall, if exercising the put option created hereby, deliver to such Shareholder
the certificate or certificates representing Common Shares or Convertible
Securities to be sold hereunder, each certificate to be properly endorsed for
transfer.
(c) Such Shareholder shall, upon receipt of the certificate or
certificates for the Common Shares or Convertible Securities to be sold by a
Holder pursuant to Section 3.2, free and clear of all adverse claims, pay the
aggregate purchase price therefor and the amount of reimbursable fees and
expenses, as specified in Section 3.2(a), by certified or cashier's check made
payable to the order of the Holder.
(d) Notwithstanding the foregoing, any attempt to Transfer
shares of the Company in violation of the terms of this Agreement shall be void
and the Company agrees it will not effect such a Transfer nor will it treat any
alleged transferee as the holder of such Securities without the written consent
of the Holder.
SECTION 4. LEGENDED CERTIFICATE.
4.1 LEGEND. Each certificate representing Common Shares now
or hereafter
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owned by any Shareholder shall be endorsed with the following legend:
THE SALE OR TRANSFER OF THE SECURITIES REPRESENTED BY THIS CERTIFICATE
IS SUBJECT TO THE TERMS AND CONDITIONS OF A CERTAIN CO-SALE AGREEMENT BY
AND BETWEEN THE SHAREHOLDER, THE COMPANY AND BANC ONE CAPITAL PARTNERS
II, LLC. COPIES OF SUCH AGREEMENT MAY BE OBTAINED UPON WRITTEN REQUEST
TO THE SECRETARY OF THE COMPANY.
4.2 LEGEND REMOVAL. The Section 4.1 legend shall be removed
upon the earlier of the termination of this Agreement or the date upon which
the provisions of this Agreement are no longer applicable to such shares in
accordance with the provisions of Section 5.
SECTION 5. TERMINATION OF CO-SALE RIGHTS.
The rights of the Holder under this Agreement and the obligations of the
Shareholders with respect to the Holder shall terminate at such time as BOCP or
any of its Affiliates does not own any Common Shares. Unless sooner terminated
in accordance with the preceding sentence, this Agreement shall terminate upon
the occurrence of the earliest to occur of any of the following events:
(a) The liquidation, dissolution or indefinite cessation of
the business operations of the Company;
(b) The execution by the Company of a general assignment for
the benefit of creditors or the appointment of a receiver or trustee to take
possession of the property and assets of the Company;
(c) The consummation of an Initial Public Offering; or
(d) The consummation of a Disposition.
SECTION 6. OTHER OBLIGATIONS OF COMPANY.
The Company agrees to use all reasonable efforts to enforce the terms of
this Agreement, to inform the Holder of any breach hereof and to assist the
Holder in the exercise of its rights and performance of its obligations under
Section 3 hereof.
SECTION 7. MISCELLANEOUS.
The provisions of Section 13 of the Purchase Agreement are applicable to
this Agreement
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and are, to the extent applicable, incorporated by reference in this Agreement.
The parties have executed and delivered this Agreement effective as of
the day and year first above written.
COMPANY:
SCC COMMUNICATIONS CORP.
By: /s/ ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇ AMERITECH DEVELOPMENT
--------------------------- CORPORATION
By: /s/ ▇▇▇▇▇▇ ▇▇▇▇▇▇
---------------------------
Its: CHIEF FINANCIAL OFFICER Its: DIRECTOR
-------------------------- --------------------------
SHAREHOLDERS: BOSTON CAPITAL VENTURES
LIMITED PARTNERSHIP
/s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇
------------------------------
▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇ By: BC&V Limited Partnership, Its
General Partner
/s/ ▇▇▇▇ ▇▇▇▇
------------------------------ By: Boston Capital Partners, Its
▇▇▇▇ ▇▇▇▇ General Partner
/s/ ▇▇▇▇▇ ▇▇▇▇▇▇▇▇
------------------------------ By: /s/
▇▇▇▇▇ ▇▇▇▇▇▇▇▇ -----------------------------
Its: General Partner
THE HILL PARTNERSHIP III, A
LIMITED PARTNERSHIP
By: ▇▇▇▇, ▇▇▇▇▇▇ Ventures, a Limited
Partnership, Its General Partner
By: /s/ ▇▇▇▇ ▇▇▇▇
-------------------------------
General Partner
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HOLDER:
BANC ONE CAPITAL PARTNERS II,
LLC
By: Banc One Capital Partners
Holdings, Ltd. Manager
By: /s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
--------------------------------
▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
Its: Authorized Signer
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